Starbucks hit by crisis, to close 300 stores, cut 6,700 jobs

Starbucks Corp, the world's largest chain of coffee shops ,said Wednesday it will close 300 stores and reduce as many as 6,700 jobs.

Sales at established U.S. stores dropped 10 percent in the latest quarter.

There will be 200 store closures in the U.S. with the rest coming internationally. These cuts are in addition to the approximately 600 U.S. store closings announced in July 2008.

The workforce cut will eliminate 6,000 positions in stores and 700 in corporate jobs, the company announced in a statement.

In the last few weeks we have seen countless companies announce layoffs and some bankruptcies. I point this out to try and put in context that the financial crisis is affecting almost every company around the world. The decisions we make are about preserving the future of Starbucks, wrote Chief Executive Howard Schultz in a memo to employees posted on the company web site.

The coffee store chain operator plans to save at least $500 million or $100 million more than it previously expected.